Smaller Share of College Students Are Working Their Way Through School

On Sunday, Starbucksannounced a plan to help its employees receive a bachelor’s degree from Arizona State University with a tuition reimbursement program for people who work at least 20 hours a week. This isn’t the first opportunity Starbucks has given to its employees to obtain a higher education, but it is the most extensive. Starbucks estimated about 70% of its 135,000 part-time or full-time workers in the U.S. are current or aspiring college students.

A smaller percentage of 16-24-year-old college students are working their way through the higher education experience, according to Labor Department data. In fact, 2013 saw the lowest percentage of students working since 1985 with only 43.9% working either full time or part time while enrolled in school. Working students were at their peak in 2000, when 56% of enrolled students worked. The decline is surely due in part to the recession. But even though the overall unemployment rate for 16-24 year olds has improved since peaking in 2010, the total share of students working has continued to trend lower.

The Starbucks announcement comes at a time when many employers are discontinuing their tuition assistance programs. College tuition, room and board and fees hit all-time highs. Four-year universities have seen exponential cost increases in the past 35 years. Since 1979, four-year public universities saw a 651% total cost increase. Private universities increased costs by 600%. Hourly wages haven’t come close to keeping pace, especially not for young part-time workers. Among 16-24-year-old workers who are paid an hourly wage, median pay has increased just 159% since 1979. Taking inflation into account college costs for both private and public institutions have more than doubled, while median hourly wages for young people have fallen by 18%.

Even as a smaller share of college students are working, more are taking on debt. A little over 70% of this year’s bachelor’s degree recipients are leaving school with student loans, up from less than half of graduates in the Class of 1994. As the Journal noted last month, the Class of 2014 is the most indebted ever with an average of $33,000 in student loans. That’s enough to buy nearly 16,000 cups of Starbucks coffee.

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